The incoming director of the Federal Housing Finance Agency says that he will delay Fannie Mae and Freddie Mac’s planned increases on mortgage fees until he has time to review the reasoning behind it.
The move by Mel Watt, D-N.C., who was confirmed by the Senate earlier this month, comes after FHFA’s current acting director Edward J. DeMarco announced the hikes.
Fannie Mae and Freddie Mac said earlier they intend to charge more to lenders who guarantee loans for borrowers with mid-range-or-below credit scores, as well as borrowers who don’t meet certain down payment guidelines. Lenders likely would have passed down to borrowers, could have cost a borrower with a $200,000 30-year mortgage about $4,000 extra over the life of the loan — or about $11.11 extra per month.
The fees were set to take effect in March and April. Critics in the mortgage and housing industry had argued that the fees were too high and that fee hikes on lenders are usually passed on to borrowers via higher interest rates. Your comments?
Source: “New FHFA director stops rate hikes short,” HousingWire (Dec. 23, 2013) and “Fannie Mae Fee Increases to be Delayed by FHFA Under Watt,” Bloomberg (Dec. 21, 2013)